Last amendments to the Construction Law
Daniel Vlasceanu – Partner, Vlasceanu & Partners
On 30 October 2019 the last amendments (adopted under Law no 193/2019 – hereinafter the “Amendment(s)”) to the Construction Law no 50/1991 (the “Law”) were published in the Official Gazette of Romania. As per Article 12 para 1 of the Law no 24/2000 on legislative technique, the Amendments entered into force on 2 November 2019.
We interpret the Amendments as a positive step forward towards reducing bureaucracy and, consequently, the duration of the permitting process. One may see that the legislator “invites” the public authorities to use modern techniques (already available for a number of years within the business environment) – e.g. submitting clarifications via e-mail or issuing urbanism certificates with a digital signature. However, using such technical means by the authorities may be rather seen like an “audacity” challenge rather than a technological one, but one should not exclude city halls located in remote areas (where internet has not reached yet).
Kindly find below a brief description of the most relevant amendments for the energy sector:
- Clear limitations as to what public authorities may ask from the applicant
We have experienced situations when authorities extensively (almost abusively) interpreted certain (mostly technical) aspects of the permitting application and asked for supplementary documents or even imposed conditions hardly related to the object of the requested building/ demolition permit. In an attempt to prevent such situations, the Amendment (under Art. 5 para 4 of the Law) expressly forbids requesting under the urbanism certificate any approvals unrelated to the permitted objective.
- Measures to speed up the permitting process
Filing/ obtaining documentation with/from the competent authorities in person may be inefficient (particularly in case of demolishment permits when it is likely that the applicant is no longer active in said area).
We welcome the newly introduced possibility to validly communicate the urbanism certificate, in a digital format (bearing a digital signature), via e-mail (as per Art. 6 para 22 of the amended Law). Moreover, if the technical documentation needs rectification/ supplementation, such actions may be requested via e-mail. These measures could facilitate official valid communication via e-mail (which would obviously speed up/ shorten the permitting procedure).
Emergency issuance of building permit was reduced to only 7 days (from 15), against an emergency tax. However, the effective application of this emergency procedure will depend on the efficiency of the county/ local competent authorities, as each of them must organize its own system and set a tax (Art. 7 para 16 of the amended Law).
The urbanism certificate must be issued within 15 days (reduced from 30 days), as per Art. 6 para 2 of the amended Law. Moreover, the verification of the supporting technical documentation must be performed by the authorities within 10 working days for the urbanism certificate and within 5 working days for the building permit.
- Simplification measures
Overall, the spirit of the Amendment is clearly in favor of simplifying the permitting formalities; it introduces a number of measures meant to remove/ facilitate completion of the permitting steps. Some of said measures are currently (in a similar form) included in the Application Norms of the Law, but they will benefit of superior legal strength being directly reflected in the Law.
The most relevant are:
- should the works not start within the permit’s validity period, (under certain conditions) a new permit may be granted without the issuance of an urbanism certificate and other approvals [(as per Art. 7 para 6 under the amended Law);
- should the works not be completed within the permit’s validity period, (under certain conditions) a new permit may be granted without the issuance of an urbanism certificate and other approvals [As per Art. 7 para. (61) under the amended Law];
- should the works be suspended for a period longer than the permitted execution duration, (under certain conditions) restart of the works may be allowed only on the basis of a technical report regarding the completed works [As per Art. 7 para. (62) under the amended Law].
- Specific aspects for the oil and gas industry
There has been a debate for almost a decade with respect to the necessity of obtaining (or not) a construction permit when acquiring seismic. Art 3 para 1 letter e) of the Law refers to industrial constructions that can be built with the observance of the provisions of the construction permit and of the specific regulation for (among others) “drilling and excavation works required for geotechnical studies and geological prospects”. The Amendment introduces under Article 11 para 7 letter c) of the Law an exception from the obligation to obtain a building permit for “seismic prospecting […] provided they do not entail drilling or construction works”.
The Amendment maintains the exception from the obligation to prepare an urbanism documentation for permitting oil/ gas wells located extra-muros (Romanian: extravilan). However, for facilities or pipelines (also located extra-muros) this exception has not been extended; as such, it still can be required to prepare such urbanism documentation for extra-muros facilities/ pipelines (sometimes substantially delaying the permitting process with direct consequences on bringing onstream the production itself).
The difficulty in obtaining construction permits is one of the relevant elements when analyzing a country’s openness for doing business. In most of the debates around investments in Romania, permitting (with various facades or implications – be it access to land, lack of title evidence, improper official records etc) is constantly mentioned as an obstacle. Apart from this, our country ranks disastrously low when it comes to regulatory stability. Within this context, we dare mention the Amendment as a slim ray of light: although there is room for improvement, the Amendment aims to bring speed, clear limitations on the authorities’ interpretation and use of modern technology – all being good ingredients for improving the permitting procedure.